"It Matters How the Government Spends Any Extra Dollars

question 52

Multiple Choice

"It matters how the government spends any extra dollars." The economist who said this most likely believes that

• A) a dollar spent on one government project could raise Real GDP more than a dollar spent on some alternative government project.
• B) the AS curve is upward-sloping.
• C) the tax multiplier is larger than the government spending multiplier.
• D) government should increase in both size and scope.
• E) none of the above

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